Ukraine could become one of the most dynamic economies in Europe in the coming years, but this depends on the end of the war and the start of large-scale reconstruction of the country. The International Monetary Fund (IMF) forecasts Ukraine’s economic growth at an average of 3.8% annually for 2027-2031.
According to the IMF’s World Economic Outlook report, Ukraine could become the third fastest growing in Europe in terms of GDP growth if the forecast comes true. The eurozone economy is expected to grow significantly more slowly during this period, averaging 1.2% annually, with the best year for the region expected to be 2028 with a rate of 1.4%. The average growth rate for the whole of Europe is projected at 1.4%, with a maximum growth of up to 1.6% in 2028. The main challenges facing some European countries remain high public debt, an aging population, low labor productivity, expensive energy resources, and geopolitical instability.
Malta and Kosovo have promising prospects with 4% annual growth, Ukraine’s level is projected at 3.8%, outpacing countries such as Serbia and Moldova. A key factor in Ukraine’s economic rise is post-war reconstruction, which could also lead to a significant influx of foreign investment up to $600 billion. However, this is based on the assumption that the war will end; otherwise, economic growth could fall to 1% in 2027.
As part of support, in February, the IMF board approved a four-year extended financing program for Ukraine worth $8.1 billion. As part of the agreements, Kyiv committed to a number of conditions, including the cancellation of VAT payment benefits for individual entrepreneurs from 2027.
| Country | Average Annual GDP Growth (%) |
|---|---|
| Malta | 4.0 |
| Kosovo | 4.0 |
| Ukraine | 3.8 |
| Serbia | 3.52 |
| Moldova | 3.5 |
